19 Sep 2012

RETAILERS MUST PASS BACK SOME OF THEIR MARGIN TO FARMERS UNDER PRESSURE FROM RISING COSTS

Addressing farmers at a protest against retailers in Portlaoise this morning (Wed), IFA President John Bryan said farmers’ backs are to the wall and they will no longer stand by and allow retailers ignore the escalating costs primary producers have to deal with.

He said, “Both retailers and processors will have to get used to paying producers higher farm gate prices. This does not necessarily mean increases in consumer prices, as there has to be a better and fairer distribution of the final price back down the price chain. National and EU legislation is long overdue to restore equity in the food supply chain”.Farmers protested outside the main multiples – Tesco, Dunnes, Musgrave (Superquinn), Aldi and Lidl – to highlight the cost/price squeeze on farms.

“We have made it very clear to retailers about the problems that escalating production costs are causing on farms. Feed, fuel and fertiliser have all risen to the extent that input costs are threatening the viability of family farms. Fertiliser costs are up 25% and fuel costs are up 30% on 2010 levels. In some cases, pig producers have been forced out because of the rocketing feed price. Retailers cannot continue to ignore the impact of these increases and must return a price that covers production costs and a margin.”

The IFA President said, “There is intense pressure on sectors such as liquid milk and beef finishing as the price of feed soars. They are facing into a winter where the full brunt of escalating costs and disastrous weather will hit home. As the dominant player in the food supply chain, the responsibility is on the supermarkets to recognise the difficulties higher costs are imposing on farmers and act now.”

John Bryan was also very critical of Government inaction on this issue. “Fine Gael promised legislation that would see a Code of Conduct for the retail sector, backed up by an independent Ombudsman who would enforce the regulation.” However, Enterprise Minister Richard Bruton has done nothing to deliver on his commitment and John Bryan called on the Government to address the issue immediately.

IFA National Pigs and Pigmeat Committee Chairman Tim Cullinan said that the average retail price of pigmeat has been approximately €7/kg over the last number of years. “Since September 2010, the average feed price for pigs has increased by a whopping 70% while pig prices have increased by only 13% in the same period.”

IFA National Poultry Chairman Alo Mohan said, “Poultry products are being used as a loss leader at retail level. Quality chicken products bring customers into stores, boosting retailer’s profits, while producers are unable to recoup massive costs at farm level. Egg producers have been forced to carry the hike in feed, while retailers have resisted increases that are necessary to reflect this.”

IFA Horticulture Chairman Brian O’Reilly said supermarkets will have to recognise the increased costs in producing potatoes and fresh produce, especially after the worst summer on record, if they want a guaranteed supply of quality Irish produce.